What is the difference between a production brewery and a brewpub?
Georgia is the fifth largest beer producer in the country, but there are not a lot of breweries. Macon has one brewery and two brewpubs. If a person travels across state lines to Asheville, North Carolina, he will find the city with the most breweries per capita in the United States.
Nancy Palmer, the executive director of the Georgia Craft Brewers Guild, said there are many reasons why Georgia doesn’t have as many breweries as states such as North Carolina.
“The short answer is because our laws have not been updated as quickly as they have in other states. We were the last to get taproom sales which were majorly important to craft brewers and opening small craft breweries,” Palmer said.
Last year, Georgia passed the taproom bill that allowed breweries to sell beer directly to consumers through taprooms.
Before the law passed, brewers had to sell tours to customers that ended with a free sample of beer instead of directly selling beer to customers.
“It was a very convoluted system which really didn’t allow for our brewers to interact with consumers the way that they are interacting in other states,” Palmer said. “The taproom sales are absolutely critical for small breweries.”
Although brewpubs could already sell beer as long as they maintained 50 percent of their profit from food sales, Brian Whitley, co-owner and head brewer at Piedmont Brewery & Kitchen, said he was glad to see the bill pass.
“I think that it’s a good thing for craft beer in Georgia as a whole that we took that one bite out of the elephant,” he said.
Before the taproom law, Palmer said brewers had to be much larger in order to make a profit.
“It’s not only that we have fewer breweries, but the breweries that we have are larger on average than breweries in other states,” Palmer said.
She said Georgia is missing the smaller breweries that couldn’t have survived with the previous regulations.
Palmer said the system of laws in Georgia were put into place when there were only two large manufacturers of beer, MillerCoors and Anheuser-Busch.
Eighty-eight percent of breweries in the United States are in 37 states which allow self-distribution of beer, Palmer said. Georgia, one of the 13 states without self-distribution, has a three-tier system in which beer travels from a producer to a wholesaler who then sends it to a retailer, according to the Georgia Public Policy Foundation.
Whitley said brewpubs face similar regulations as breweries in self-distribution.
“If we wanted to sell beer to even the Rookery right around the corner, we would have to sell it to our distributor. They’d have to come down here from Atlanta, pick it up, put it in a van and take it one block away,” he said.
Yash Patel, the owner of Macon Beer Co., said he would like to see the laws change so that his company can distribute some of its beer.
“If somebody wants a keg for their wedding, I feel like we should be able to sell that to them,” Patel said.
Palmer said that allowing breweries to self-distribute would allow more breweries to operate in Georgia.
“For our Georgia craft breweries to stay competitive in the marketplace, we need our breweries to be as profitable as the other 88 percent who have access to this type of revenue stream,” Palmer said.
Georgia also has the fourth highest excise tax rate on beer, according to the Tax Foundation.
Palmer said it is hard to compare Georgia tax rates to other states because Georgia taxes draft beer and packaged beer differently, and she said she believes Georgia is the only state with a mandated local tax on beer.
“If those taxes went down, a lot more breweries would open up in the state, and it’d make our state more of a craft brew destination like North Carolina,” Patel said.
Palmer said because the taproom law passed, Georgia will start seeing around 20 breweries open a year at a minimum.
Charles McClendon, the brewmaster at Macon Beer Co., said he would like to see another brewery in Macon because it would be better for the consumer, and it’s more fun.
“There’s a camaraderie amongst brewers,” McClendon said. “It’s like playing against your best friend on a basketball team.”